Question 1

The corporate veil can be pierced under the alter ego theory when:

Accepted Answer

A) there were insufficient assets put into the corporation at its creation. 
B) the corporation was formed to avoid personal liability. 
C) personal and corporate assets or debts are mixed. 
D) too many meetings have occurred. 
A) there were insufficient assets put into the corporation at its creation. 
B) the corporation was formed to avoid personal liability. 
C) personal and corporate assets or debts are mixed. 
D) too many meetings have occurred.

Question 2

The business judgment rule holds directors liable for:

Accepted Answer

A) errors in business judgment. 
B) their mistakes. 
C) failure to obtain necessary information for making decisions. 
D) None of the above 
A) errors in business judgment. 
B) their mistakes. 
C) failure to obtain necessary information for making decisions. 
D) None of the above

Question 3

Which of the following is true of a sole proprietorship?

Accepted Answer

A) A separate tax return must be filed. 
B) It is not a business entity. 
C) There is no personal liability for the owner. 
D) None of the above 
A) A separate tax return must be filed. 
B) It is not a business entity. 
C) There is no personal liability for the owner. 
D) None of the above

Question 4

A limited partnership:

Accepted Answer

A) requires at least one general partner. 
B) can be created by implication. 
C) must be run by the limited partners. 
D) All of the above 
A) requires at least one general partner. 
B) can be created by implication. 
C) must be run by the limited partners. 
D) All of the above

Question 5

Which of the following is not a method for forming a partnership?

Accepted Answer

A) By agreement 
B) By estoppel 
C) By implication 
D) By transfer 
A) By agreement 
B) By estoppel 
C) By implication 
D) By transfer

Question 6

When principals lead others to believe there is a partnership, this is called a partnership by:

Accepted Answer

A) actual authority. 
B) implication. 
C) definition. 
D) representation. 
A) actual authority. 
B) implication. 
C) definition. 
D) representation.

Question 7

The ABC partnership (a general partnership with three partners)is dissolved in the process of terminating. Outside creditors are owed $50,000. The partners made no loans, but contributed $15,000 each in capital. After the assets are liquidated, there is $125,000. How will that amount be distributed?

Accepted Answer

Creditors - $50,000; no advanc

Question 8

The corporate veil can be pierced for inadequate capitalization.

Accepted Answer

A) True 
 B)False

Question 9

For income tax purposes, a partnership:

Accepted Answer

A) files a return and pays taxes. 
B) is an entity. 
C) has no taxes. 
D) None of the above 
A) files a return and pays taxes. 
B) is an entity. 
C) has no taxes. 
D) None of the above

Question 10

Discuss the advantages of a joint venture in a global environment.

Accepted Answer

A joint venture is a partnership of exis

Question 11

Utah Light, Inc. has a takeover offer from Cal Corp. Utah Light is experiencing difficulty with earnings and its share price has dropped from $32 to $19. Cal Corp's offer is for $23 per share. Utah Light's board feels that because of pending plans and developing assets, it should not accept the offer. Must the board accept the offer?

Accepted Answer

No, the case is a classic illu

Question 12

Incorporators are not liable for contracts entered into before incorporation.

Accepted Answer

A) True 
 B)False

Question 13

An inadequately capitalized corporation can have its corporate veil pierced.

Accepted Answer

A) True 
 B)False

Question 14

Under Sarbanes-Oxley, the majority of members of the audit committee must be independent directors.

Accepted Answer

A) True 
 B)False

Question 15

In Germany, public companies have:

Accepted Answer

A) the same structure as U.S. corporations. 
B) no board of directors, but do have a shareholder advisory committee. 
C) no shareholder advisory committee, but do have a board of directors. 
D) both a board of directors and a shareholder advisory committee. 
A) the same structure as U.S. corporations. 
B) no board of directors, but do have a shareholder advisory committee. 
C) no shareholder advisory committee, but do have a board of directors. 
D) both a board of directors and a shareholder advisory committee.

Question 16

Watered shares are shares for which the purchaser did pay more than par but less than full market value.

Accepted Answer

A) True 
 B)False

Question 17

Owners of limited liability companies enjoy flow-through treatment of income and losses.

Accepted Answer

A) True 
 B)False

Question 18

Under Sarbanes-Oxley, codes of ethics must cover financial reporting standards.

Accepted Answer

A) True 
 B)False

Question 19

Which of these would require unanimous consent of all the partners?

Accepted Answer

A) Confessing a judgment 
B) Selling the partnership goodwill 
C) Selling all partnership assets 
D) All of the above 
A) Confessing a judgment 
B) Selling the partnership goodwill 
C) Selling all partnership assets 
D) All of the above

Question 20

Limited partnerships are taxed the same way as general partnerships.

Accepted Answer

A) True 
 B)False

The corporate veil can be pierced under the alter ego theory when:

The business judgment rule holds directors liable for:

Which of the following is true of a sole proprietorship?

A limited partnership:

Which of the following is not a method for forming a partnership?

When principals lead others to believe there is a partnership, this is called a partnership by:

The ABC partnership (a general partnership with three partners)is dissolved in the process of terminating. Outside creditors are owed $50,000. The partners made no loans, but contributed $15,000 each in capital. After the assets are liquidated, there is $125,000. How will that amount be distributed?

The corporate veil can be pierced for inadequate capitalization.

For income tax purposes, a partnership:

Discuss the advantages of a joint venture in a global environment.

Incorporators are not liable for contracts entered into before incorporation.

An inadequately capitalized corporation can have its corporate veil pierced.

Under Sarbanes-Oxley, the majority of members of the audit committee must be independent directors.

In Germany, public companies have:

Watered shares are shares for which the purchaser did pay more than par but less than full market value.

Owners of limited liability companies enjoy flow-through treatment of income and losses.

Under Sarbanes-Oxley, codes of ethics must cover financial reporting standards.

Which of these would require unanimous consent of all the partners?

Limited partnerships are taxed the same way as general partnerships.

Introduction to Law

Business Ethics and Social Responsibility

The Court System and Dispute Resolution

Business and the Constitution

Administrative Law

International Law

Business Crime

Business Torts

Environmental Regulation and Sustainability

Contracts and Sales: Introduction and Formation

Contracts and Sales: Performance, Remedies, and Rights

Business Marketing and Products: Ads and Product Safety

Business Competition: Antitrust Law

Business and Intellectual Property Law

Agency Law

Governance and Regulation: Securities Law

Business and Employees: Employment Regulation

Business and Employees: Employment Discrimination

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Exam 16: Governance and Structure: the Law of Business Associations

The corporate veil can be pierced under the alter ego theory when:

The business judgment rule holds directors liable for:

Which of the following is true of a sole proprietorship?

A limited partnership:

Which of the following is not a method for forming a partnership?

When principals lead others to believe there is a partnership, this is called a partnership by:

The corporate veil can be pierced for inadequate capitalization.

For income tax purposes, a partnership:

Discuss the advantages of a joint venture in a global environment.

Incorporators are not liable for contracts entered into before incorporation.

An inadequately capitalized corporation can have its corporate veil pierced.

Under Sarbanes-Oxley, the majority of members of the audit committee must be independent directors.

In Germany, public companies have:

Watered shares are shares for which the purchaser did pay more than par but less than full market value.

Owners of limited liability companies enjoy flow-through treatment of income and losses.

Under Sarbanes-Oxley, codes of ethics must cover financial reporting standards.

Which of these would require unanimous consent of all the partners?

Limited partnerships are taxed the same way as general partnerships.

Introduction to Law

Business Ethics and Social Responsibility

The Court System and Dispute Resolution

Business and the Constitution

Administrative Law

International Law

Business Crime

Business Torts

Environmental Regulation and Sustainability

Contracts and Sales: Introduction and Formation

Contracts and Sales: Performance, Remedies, and Rights

Business Marketing and Products: Ads and Product Safety

Business Competition: Antitrust Law

Business and Intellectual Property Law

Agency Law

Governance and Regulation: Securities Law

Business and Employees: Employment Regulation

Business and Employees: Employment Discrimination

Filters